Australia, Photovoltaic technology status and prospects - Contribution to the Annual report 2004

Australia
Photovoltaic technology status and prospects
Dr Muriel Watt, Centre for PV engineering, University of New South Wales

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General Framework

Fig. 1 - Australian cell line (photo BP Solar).

The use of photovoltaic power systems (PV) in Australia continues to grow moderately, with installed capacity increasing by 16,6 % (almost identical to the previous year) to reach a total installed capacity of 45 630 kW by the start of 2004. Although not the main focus of government support programmes, off-grid non-domestic applications continue to dominate Australia's cumulative installed capacity (about 57 % by 2004, which is one percentage point lower than the previous year and down from about 75 % in the mid 1990's), with an annual growth rate that decreased slightly during 2003 to 14,6 % (compared with 18,6 % in 2002, 12 % in 2001 and 4 % in 2000). Off-grid domestic applications have enjoyed strong growth over the last decade and continue to benefit from the government support programmes aimed at increasing the use of BIPV and replacing diesel use with renewables. These applications accounted for almost 30 % of the cumulative installed capacity by 2004, again slightly lower than the figures for the previous years. Total off-grid cumulative installed capacity accounts for close to 87 % of PV installed in Australia.

The amount of PV that was connected to the grid has doubled each year over the past two years and the grid-connected market segment now exceeds 13 % of the total installed capacity compared with less than 1 % about seven years ago. The national BIPV support programme (which initially commenced in 2000) and, to a lesser extent, the mandatory renewable energy target (MRET) for electricity retailers and major energy users (implemented in 2001 and recently reviewed), which are both discussed later in this report, are widely perceived as the key factors behind this market growth. The Australian PV Industry Roadmap, launched in August 2004, identifies enhanced feed-in tariffs (a measure not implemented in Australia to date, although similar to MRET) as an important component amongst a suite of measures for promoting grid-connected PV in Australia.

The Australian electricity industry continues to play a role in both remote area power supply and grid-connected PV, although the degree of interest varies between businesses. This interest lies with both the retailing and network businesses and is largely stimulated by issues of customer contestability, the operation of greenhouse gas reduction agreements or licence conditions in a number of states and, more recently, as a means of reducing peak demand on mini grids and for selected substations.

The public is generally supportive of PV and interested in its use - however, even with rebates, PV investments for grid-connected households and community applications are difficult to justify on economic grounds because of Australia's relatively low electricity tariffs.
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National Programme

Fig. 2 - Aerial view of Kings Canyon (photo Advanced Energy Systems).

The Australian Government has initiated a number of measures over recent years to support renewable energy in general and, in some cases, PV in particular. These include:

Mandatory renewable energy target - this target seeks to increase the contribution of renewable energy sources in Australia's electricity mix by 9 500 GWh per year by 2010, with that target continuing until 2020. Since 1 April 2001, electricity retailers and large energy users (known as liable parties) must purchase increasing amounts of electricity from renewable sources. A trade in Renewable Energy Certificates (RECs) and financial penalties for non-compliance are features of this scheme. A major review of the scheme - Renewable Opportunities: A Review of the Operation of the Renewable Energy (Electricity) Act 2000 - was published in January 2004. With respect to PV, the recommendations of the review that have been supported by the Government during 2004 include: extending the deeming provisions for small PV systems from 5 to 15 years and increasing the deeming threshold from 10 to 100 kW. These changed provisions are expected to pass through Parliament in early 2005. This could equate to an effective 5-10% reduction in the system price based on current RECs value, since deemed systems can claim their RECs when installed, rather than on the basis of actual annual output.
Supporting the use of renewable energy for remote power generation (RRPGP) - this programme commenced in 2000 and is expected to make available around 200 million Australian dollars over nine years for the conversion of remote area power supplies (including public generators and mini-grids) from diesel to renewable energy sources, and for new renewable installations that would otherwise have been fueled by diesel. The RRPGP provides up to 50 % of the capital value of the replacement or new renewable generation for off-grid users of diesel-based power systems. Recent changes to the terms of the grants mean that from 2005 fringe-of-grid will also fall under RRPGP, grants will now be available for other fossil-fuel replacement (not just diesel), and that energy efficiency and solar water heaters will also qualify. The programme is administered by and is different in each State and Territory: Western Australia's Remote Area Power Supply (RAPS) sub-programme, targeting indigenous communities, isolated households and commercial operations such as pastoral properties and tourist and mining operations; Western Australia's Renewable Energy Water Pumping (REWP) sub-programme; Northern Territory's Renewable Energy Rebate Programme (RERP), targeting small and large communities, households, commercial and industrial operations; Queensland's Working Property Rebate Scheme (WPRS) targeting family owned working properties; Queensland's Renewable Energy Diesel Replacement Scheme (REDRS) targeting indigenous communities, households and businesses; Tasmania's Residential Remote Area Power Supply Sub-programme and RRPGP subprogrammes in NSW and South Australia. Bushlight (Indigenous Renewable Energy Services Project) is a national sub-programme which aims to both increase industry capacity to service indigenous communities and to build greater understanding of renewable energy issues within communities, and RESLab is a renewable energy systems test centre, also supported under industry support components of the RRPGP.
Supporting the use of solar photovoltaic electricity on residential and community buildings, the PV Rebate Programme (PVRP) - this programme commenced at the beginning of 2000, initially with 31 million Australian dollars available over four years, and then extended until early 2005 with a further 5,8 million Australian dollars made available. Funding is provided by the Australian Government, with administration by the State Governments, and provides rebates to householders or community building owners who install grid-connected or stand-alone photovoltaic power systems.
Under the currently operating extension, householders are eligible for a rebate of 4 AUD/W capped at 4 000 AUD per residential system.Smaller rebates are also paid for extensions to an existing system.Community buildings attract the same rebate but have a higher cap of 8 000 AUD. The Australian Government has also made available one million Australian dollars to fund projects by residential housing developers, through a competitive bidding process.

In June 2004, an Energy White Paper “Securing Australia's Energy Future” was released by the Australian Government. It includes a number of new measures targeting renewables:

Solar Cities trials - 75 million Australian dollars have been allocated over 5 years to demonstrate high penetration uptake of solar technologies, energy efficiency, smart metering and other options aimed at improving the market for distributed generation and demand side energy solutions. Tenders have been called for consortia to install PV and other distributed generation options in four urban sites, with detailed monitoring and associated tariffs, marketing and financing also being supported.
Commercialization of renewable energy technologies - 100 million Australian dollars have been allocated over seven years to promote strategic development of renewable energy technologies, systems and processes that have commercial potential. A further 20 million Australian dollars will be provided to support development of advanced electricity storage technologies, including batteries, electro-mechanical and chemical storage.
Market Leader Technologies - PV and Remote Area Power Systems have been identified as technologies of strategic importance for Australia and for which Australia has a clear technological advantage internationally. This will be reflected in priorities for Government R&D funding.

Fig. 4 - Solomon Islands 600T Sun Mill (photo Solar Energy Systems). State government policies also support PV market growth. For example, the New South Wales Government has set a state-wide benchmark of reducing greenhouse gas emissions. The parties who are required to meet targets for greenhouse gas emissions must reduce the average emissions of greenhouse gases from the electricity they supply or consume to the pre-set individual benchmark level (or they pay a penalty). To achieve the required reduction in greenhouse gas emissions, benchmark participants purchase and surrender certificates called NSW Greenhouse Abatement Certificates (NGACs) which may be created by any eligible measures which reduce the average greenhouse intensity of electricity generation. In theory, this includes grid-connected PV systems, though in practice the relatively low penalty (buy-out) favours already economic or nearly-economic demand-side measures.

A number of key agencies at both Federal (the Australian Greenhouse Office) and State (the NSW Sustainable Energy Authority) levels have been restructured and their functions absorbed within broader departments. The likely impacts of these changes are not clear at this time, though for the time being most PV-related programmes are continuing in line with existing plans.
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Research, development and demonstration

Fig. 5 - Technician Training in Sri Lanka (photo GSES).

Australian Government annual funding for PV R&D, D (including market incentives) was about 29,2 million Australian dollars during 2003 (compared with 20,3, 16,7 and 24,6 million Australian dollars for the three previous years). Funding from the state governments for the same period was around 0,9 million Australian dollars, significantly more than for the previous year.

A new Centre of Excellence in Advanced Silicon Photovoltaics and Photonics has been established at the Centre for PV Engineering, University of NSW. Research streams are focused on short (1st generation), medium (2nd generation) and long term (3rd generation) technology needs. 1st generation work includes continued improvement of the buried contact cell, the use of phosphorous doping in place of boron, and fabrication on thinner wafers. 2nd generation research includes support for commercialising crystalline silicon on glass technology, as well as research into improved silicon deposition quality and grain size, manufacturing cost reduction and non-metal contacts. 3rd generation technology is expected to be both high efficiency and thin film, with research focusing on all-silicon tandem cells based on bandgap-engineering, silicon light emitting devices and lasers, and light trapping. Other researchers at the University of NSW are working on GaAs solar cells.
BP Solar Australia significantly increased both its mono and poly silicon cell efficiencies by installation of new plasma enhanced chemical vapour deposition (PECVD) Silicon Nitride systems on its production lines. BP Solar continues its development of automated production equipment.
CSG Solar (formerly Pacific Solar) is developing and commercialising a thin film PV technology called Crystalline Silicon on Glass based on initial research at the University of NSW. In addition to its PV module R&D, Pacific Solar developed and commercialised its own module inverters and roof mounting systems which have now been sold as a separate business.
Origin Energy is commercializing the “Sliver cell” PV technology developed by the Australian National University. The technology promises crystalline Si cell performance with significantly lower wafer requirements. The ANU team is also developing parabolic trough and paraboloidal dish PV concentrator systems, and associated concentrator cells, trackers, controllers and mirrors, as well as a Combined Heat and Power Solar System. It is also undertaking research into thermochemical storage and phase change energy storage materials.
Sustainable Technologies International (STI) continued pilot production and further development of its titania dye sensitized solar tiles and panels, with the installation of several demonstration systems.
Solar Systems Ltd. continues development and commercialization of its PV tracking concentrator dishes for off-grid community power supplies or end of grid applications. Current systems achieve 500 times concentration and use air or water cooling. System efficiencies of 20 % have been achieved. The systems are currently based on silicon cells, but work is continuing on development of non-silicon devices, which are expected to achieve 40 % efficiency.
PV Solar Energy has developed a building integrated PV Solar Tile™ product which can now be used with a PV AirFlow™ ventilation or heat extraction system. The tile itself can be used as a weatherproof roofing material, with good thermal performance characteristics, while the airflow system allows air to flow behind the PV panels and into the roof cavity, whence it can be externally vented in summer (or used for other purposes) or internally vented in winter.

Other PV research undertaken at Australian universities include:

Flinders University - improved dye sensitised solar cells.
University of Queensland - semiconductor biopolymers
Newcastle University - nanoscale polymer devices.

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Implementation

Annual PV installations in Australia rose to 6,5 MW in the year up to the beginning of 2004 (up from 5,5 MW the previous year) and the figures for total installed capacity continue to be dominated by the off-grid market for agricultural/industrial uses (particularly telecommunications systems, shipping, rail and road signalling, water pumping, cathodic protection, billboards and electric fences) and private dwellings.

More than 3 MW in over 2 000 household / community building PV systems have been connected to the grid as a result of five years of operation of the PVRP. The programme has also resulted in about 3,5 MW and over 3 500 off-grid installations during the same period. This programme is scheduled to end in mid 2005, although extensions are being considered.

Fig. 6 - Telstra installation (photo BP Solar). The off-grid market is also helped by the RRPGP sub-programmes, with funding available for possibly a further five years. Although it is not PV specific, 2,13 MW of PV has been installed in small projects and 280 kW in larger mini-grid systems under this programme to end 2003. Almost all small systems include some PV and PV makes up about 90 % of installed capacity in small systems. Major PV projects supported by the RRPGP include a 55 kW system at an indigenous community and a 222 kW system at a tourist resort. Three concentrator dish PV systems, with a total capacity of 720 kW are under construction for indigenous communities in the Northern Territory. However, a recent government decision to remove diesel excise for stationary applications is likely to significantly affect the economics for diesel-replacement, which is a key driver for off-grid PV investments.

Green Power sales from the twelve Green Power retailers were recorded at about 131 GWh (year to date) in the third quarter of 2004 (a similar level to the previous year). While the Green Power market in its early stages was a strong driver for PV projects, PV electricity now accounts for less than 0,12 % of total green electricity purchased by the retailers - and is becoming relatively less significant each year. Only one third of the available Green Power products contain PV, with energy retailer EnergyAustralia's PureEnergy product accounting for about half of the Green Power PV electricity sourced nationally.

As for Green Power, the generic market based approach to renewable energy implementation under the MRET scheme has done little to stimulate the PV market. In 2003 about 0,15 % of renewable energy certificates (each equivalent to 1 MWh of generation) created under MRET were generated from PV systems. The modifications to PV deeming provisions mentioned earlier may increase interest in PV for MRET.

Although maintaining a general interest in PV, only a small number of electricity businesses are currently installing PV systems. Some retailers own and operate systems installed during the 1990's. There is some electricity business interest in using PV to achieve peak load reduction in diesel power stations. Electricity businesses will be involved with the four Solar Cities trials.
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Industry status

BP Solar remains the major PV manufacturer in Australia carrying out cell fabrication from imported wafers, through to module fabrication as well as total system production. BP Solar's cell production rose to over 26 MW during 2003 - about 80 % of production capacity. 64 % of cells produced in Australia during 2003 were exported. 9 MW of modules were manufactured, about half of which were exported.
Cell production capacity is expanding. BP Solar's module ratings continued to increase, with typical modules now rated at 160 W.
Sustainable Technologies International is manufacturing Titania Dye Sensitized products (first phase capacity of 500 kW) with in-house manufacturing of all the key materials for DSC technology: titania paste, dye, electrolytes, catalytic paste, interconnecting material and internal sealants. The product is aimed primarily at façade integration.
CSG Solar (formerly Pacific Solar) will continue research on its thin-film CSG product in Australia, but will begin manufacture in Germany and has sold its Plug&Power™ ac module business.
Solar Systems is continuing to expand the installation of its successful CS500 solar concentrator PV dishes in remote communities. These parabolic solar tracking dishes consist of 112 mirrors concentrating to the equivalent of 500 suns onto 24 kW water-cooled upgradeable receiving modules.
Origin Energy will open its pilot line in 2005 in Adelaide, which is designed to commercially demonstrate the potential of the SliversTM technology.
PV Solar Energy Pty Ltd has developed and demonstrated a new PV roof tile, based upon a versatile extruded aluminium frame. The tile uses a new low cost pluggable PV junction box, developed by Tyco Electronics and monocrystalline solar cell laminates.

There are several Australian manufacturers of inverters, controllers, batteries and other components, as well as of specialized end use products, such as water pumps, electric fences, lights and hybrid power supplies. The inverters and controllers cover both grid and off-grid markets, several new products have been introduced and prices fell markedly in 2003, after being relatively stable for some years. This will have significant positive impacts on the overall cost of PV systems.
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Market development

Fig. 7 - Train signalling in the Australian countryside (photo BCSE).

Growth in the local Australian market saw annual sales expanding by 17 % during 2003, down from the 27 % growth experienced the previous year. Imported cells, modules and BOS components are increasingly being used in the Australian market.

Australia's vast size and sparse population have made effective remote area telecommunications, power supplies, water pumping, navigation aids and transport route signaling critical and expensive. PV continues to provide an important commercial alternative to diesel and central grid supplies for such applications. The telecommunications market sector is likely to remain strong over coming years. The water pumping market is also performing strongly. Increased interest and activity are also evident in the medium sized centralised system market for supply to “mini-grids” for off-grid communities and commercial enterprises. Installations include flat plate and concentrator systems for aboriginal communities and for tourist facilities. The off-grid diesel replacement market for PV will however be adversely effected by a Government decision to remove fuel excise from off road diesel usage by 2012.

With its relatively low electricity tariffs, PV remains an expensive option for grid applications in Australia and with government grants for grid-connected systems scheduled to cease during 2005, there is a strong concern that this market sector may well stall.

The MRET review noted that further consideration should be given to special assistance measures that would support the development of the PV industry in Australia, including measures to support increased installation of systems. The PV Industry Roadmap, developed by the Australian Business Council for Sustainable Energy, has outlined a two part policy framework to drive investment in PV and Australian production. Firstly there are the broad-based industry and market development initiatives - market stimulation and support, removal of regulatory barriers and stimulation of industry capacity and capability. Secondly are measures focusing on specific PV markets - 150 000 grid-connected roof-top programme (underpinned by feed-in tariffs), diesel fuel replacement programme and export market initiatives. Targets for installed PV capacity of 350 MW and 6 740 MW by 2010 and 2020 respectively have been identified.
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Future outlook

Fig. 8 - Water pumping for stock (photo Solar Sales).

The Australian PV Industry Roadmap suggests that PV in Australia is at a crossroads. The mid-term outlook for PV applications remains reasonably healthy, but the near-term may present challenges, especially for grid-connected applications. Green Power schemes and MRET are not delivering their initially anticipated levels of investment in PV. There continues to be a lack of PV installations for grid support or other distributed system benefits and it remains a challenge in Australia to promote the real value of distributed generation sources such as PV through appropriate regulation and market mechanisms. Recent state government building energy standards, such as the NSW BASIX scheme which gives credit to PV, may assist in the development of the BiPV market. In addition, consistent planning processes and guidelines, which typically operate at local government level, are needed in order to streamline building approvals and to guarantee solar access. Nevertheless, the installation of PV systems up to 10 kW is becoming more of a straightforward and accepted practice in Australia and work has been carried out on uniform installation and connection guidelines, and straightforward contracts. Interest and initiatives are in evidence at all levels in the community, but public funding support remains critical for the forseeable future.
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